A variety of engine controllers and methods are described for controlling engines operating in a cylinder output level modulation mode. In one aspect transitions between different effective firing fractions are managed by gradually ramping an effective firing density. In another, when an engine transitions to a multi-level skip fire firing density that has more than one possible high/low/skip sequence, the phase of the high/low pattern is set relative to the phase of the firing pattern to ensure that a preferred high/low/skip sequence is generated. In another aspect, rapid large torque changes can be implemented in part by immediately changing the operational high/low fraction in response to a command to increase or reduce the desired engine torque.